announcement

The AAA's Centers for Advancing Accounting hosted their inaugural event: the Accounting IS Big Data Conference, on September 3-4, 2015 in New York City at the New York Marriott Marquis located in the heart of Times Square.

The meeting was amazing. If you did not attend, you will still be able to participate! The sessions were all video taped and will be made available to AAA members shortly. Case materials used during the conference will also be made available to AAA academic members soon. (Click on the Conference "Members Only" button above.)

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The conference was organized around four questions: What IS big data? How is it transforming accounting? Who can help us? and What is the impact on the academy? Here are links to the conference resources organized by the questions.

Panel discussion of accounting researchers and practitioners about how big data changes research questions and what we research.

What are the teaching opportunities?

Emerging teaching pedagogies: “Massively Adaptive Education”

Panel discussion of accounting professors and practitioners about how they are integrating big data and analytics into activities, courses, and undergraduate and graduate curricula for accounting and business students.

Over the last few weeks, I’ve given a number of keynotes, participated in several panels and run a major chunk of a Big Data event. The focus has been to answer the question “Can or should accountants care about big data?” While most of the technologists reading this will likely say something like “Sure” or “Absolutely”, the accounting-oriented audiences I met with were initially and deeply skeptical.

I watched these many weeks, as different speakers explained:

What big data is (“It probably won’t fit in an Excel spreadsheet!”)

How much net-new data is being created everyday (Seems everyone has a data tsunami slide these days!)

What the different kinds of big data are and how they vary in quality, accuracy, etc.

And much more

But the accountants and accounting professors weren’t moved. At least they weren’t moved until they were confronted with some overwhelming proof points of where big data is being used to:

Improve the quality of budgets, plans and forecasts

Enhance top line revenue

Reduce operational costs

Detect fraud

Assess the viability of a company as an on-going concern

To date, many accountants have seen big data as something used by people in business operations or marketing. They incorrectly see it as being immaterial to the job/role or value that accountants can bring to businesses. That perspective is wrong.

Big data use cases

For last week’s American Accounting Association’s Accounting IS Big Data conference, I researched 12 use cases where Big Data was definitely impacting Accounting, the companies using the Big Data, and the competitors of firms using this information. These use cases covered how:

Better sales planning by manufacturers is possible via better understanding of end-consumers and their interaction with their own and competitors’ products. Firms are using social sentiment and Internet of Things (IoT) inputs to get better sales plans.

Firms are enhancing revenue by better tailoring offers to end consumers by using techniques like shopping cart analysis, segmentation, beacons, and so on.

Retailers and hospitality companies are using weather and historical/seasonal sales data to predict optimal staffing levels and optimizing labor costs.

Traditional HR tech and processes can be supplemented with big data to reduce talent acquisition costs

The use of internal HR, “dark” Big Data like email, social and other digital breadcrumbs can stem unplanned attrition and the adverse cost impact this has on financial performance

Hospitality, travel, food service and other firms are predicting future sales performance based on public review site data found at places like Yelp, TripAdvisor, Booking.com and others.

Over 200 people worked in teams to review piles of news stories, reports, and other data sources around specific use cases. They then reported out to the conference attendees:

What they read/learned

How big an impact Big Data was having on these firms

What implications exist for accountants, auditors, educators, etc.

…and more

Following these de-briefs, the audience identified a number of ah-ha moments while also raising a number of concerns that the profession must address. A sampling of these involved:

The need to better understand privacy and security issues regarding the sourcing, use and sale of Big Data.

The need for better mechanisms to value Big Data.

The discovery efforts required to better understand companies’ pre-existing dark data, which is information a company already collects like email but doesn’t use.

The use cases were the key to changing perspectives.

The new kids on the block

The use cases also introduced accounting professionals to a whole new group of technology and data vendors. These included:

Acxiom

Aviso

BrightEdge

Connect6

DataSift

Entelo

Glassdoor

GNIP

HireVue

Jibe

Kronos

Oversight

Radian6/Salesforce

Radius

Visier

What else did accounting professionals learn?

There’s a reason why Workday, Infor and SAP, among others, have redesigned or created new financial accounting solutions that support many more data types and access methods than traditional solutions. This is why technologies like in-memory databases, Hadoop and others are now part of the standard financial software kit.

Excel, while a great product, is just not going to be the go-to tool for handling these large datasets.

New students/graduates need exposure to a new set of accounting technologies, data sets, security and privacy issues.

Business schools must modify their curricula to reflect the changes that a big data fueled business world brings to this space.

Every business plan/forecast can be measurably improved when big data is added to the effort.

Fraud detection can be materially enhanced when existing transaction data can be analyzed along with other datasets.

Will the profession change?

Will the profession change overnight? Probably not. Accounting is a profession that changes when others start to change, surface issues and begin to experiment. The recent exposure to big data may start that change. Technology vendors will not wait for the profession and it’s their innovations (and continuing adoption by businesses) that will act as a continuing catalyst for change. This should be a fun one to watch.

Disclosure: SAP, Infor, Workday and Salesforce are premier partners at time of writing.